Insights on Canadian Society
The Canada–U.S. gap in women’s labour market participation

by Marie Drolet, Sharanjit Uppal and Sébastien LaRochelle-Côté

Release date: August 17, 2016

Start of text box

Overview of the study

This study reports on the trends in the labour force participation rate (LFPR) of prime-aged women (25 to 54) in both Canada and the United States. The paper examines the population groups that have been behind the rising divergence in the LFPR between the two countries over the past two decades.

  • In 1997, the labour force participation rates (LFPRs) of women aged 25 to 54 in Canada and in the United States were close, at 76% and 77% respectively. In 2015, the LFPR of women aged 25 to 54 was 81% in Canada, compared with 74% in the United States, a gap of 7 percentage points.
  • In the United States, the LFPR declined by almost 3 percentage points between 1997 and 2015—mainly as a result of a decline in the LFPR of younger women (aged 25 to 44).
  • In Canada, the LFPR increased by 5 percentage points over the same period. The increase was mainly the result of an increase in the LFPR of women aged 45 to 54.
  • In Canada, rising levels of educational attainment explained the entire increase in the LFPR of women aged 25 to 44 and about one-third of the increase in the LFPR of women aged 45 to 54. In the United States, without the positive contribution of rising educational attainment, the female LFPR would have declined even more over the period.
  • In both countries, there has been a reduction in the male-female gap in participation rates. In Canada, the reduction mostly came from increases in the LFPR of women. In the United States, the reduction largely came from a reduction in the LFPR of men.

End of text box

Introduction

Substantial increases in the labour force participation of women are a striking feature of the labour market developments in most Western nations.Note 1 While the growth in participation began at different times and has advanced at different rates, the quantitative changes in the North American labour market over the past three decades have been remarkable.

According to the Organisation for Economic Co-operation and Development (OECD), in 1990, women in Canada and the United States had the 5th and 6th highest labour force participation rates (LFPRs) among 22 Western economically advanced nations.Note 2 By 2014, however, both Canada and the United States saw their international rankings slip to 11th and 20th positions, respectively. This decline in rankings was due to the fact that the average LFPR of women in the other OECD countries grew faster than in Canada and the United States.Note 3

Given the linked nature of the Canadian and American economies, comparisons between labour markets in Canada and the United States have garnered considerable attention. While the difference in the participation rate remained relatively small between  Canadian and U.S. men in recent years, the participation rate of females diverged between the two countries. Why is it that the labour force participation rate of Canadian women is so different from the rate of their American counterparts?

This article attempts to sort through various explanations to create a comprehensive picture of the Canada–U.S. gap in the labour force participation rates of prime-aged women (aged 25 to 54). Restricting the comparison to the core working age population simplifies the analysis, since it minimizes the potential impact of the changes in years of schooling and age of retirement that took place during the period studied.

In this paper, data from the Labour Force Survey (LFS) are used to study Canadian trends. The Current Population Survey (CPS) is the source of data for the United States. Both the LFS and the CPS are monthly household surveys that use similar methodologies. Throughout the paper, the results for Canada have been adjusted to make them comparable with the U.S. concepts (see Data sources, methods and definitions).

Diverging trends in labour force participation rates

Since the late 1990s, Canadian women have had relatively higher rates of labour force participation than American women (Chart 1). This contrasts with the 1970s and 1980s when participation rates in the United States were slightly higher than those in Canada. For example, in 1976 the LFPR was 52% for Canadian women compared with 57% for American women.

Chart 1 Labour force participation rates in Canada and the United States, women aged 25 to 54, 1976 to 2015

Data table for Chart 1
Chart 1
Labour force participation rates in Canada and the United States, women aged 25 to 54, 1976 to 2015
Table summary
This table displays the results of Labour force participation rates in Canada and the United States. The information is grouped by Year (appearing as row headers), Canada and United States, calculated using percent units of measure (appearing as column headers).
Year Canada United States
percent
1976 51.9 56.8
1977 53.3 58.5
1978 55.8 60.6
1979 57.5 62.3
1980 59.5 64.0
1981 62.1 65.3
1982 62.8 66.3
1983 64.4 67.1
1984 66.0 68.2
1985 67.9 69.6
1986 69.5 70.8
1987 70.8 71.9
1988 72.4 72.7
1989 73.7 73.6
1990 74.7 74.0
1991 75.1 74.1
1992 74.4 74.6
1993 74.8 74.6
1994 74.5 75.3
1995 74.8 75.6
1996 75.1 76.1
1997 76.2 76.7
1998 77.0 76.5
1999 77.7 76.8
2000 77.9 76.7
2001 78.5 76.4
2002 79.9 75.9
2003 80.6 75.6
2004 81.0 75.3
2005 80.6 75.3
2006 80.6 75.5
2007 81.5 75.4
2008 81.3 75.8
2009 81.5 75.6
2010 81.7 75.2
2011 81.5 74.7
2012 81.8 74.5
2013 82.1 73.9
2014 81.2 73.9
2015 81.3 73.9

The labour force participation rate in both countries exhibited strong growth during the 1980s, although it increased at a faster pace in Canada. As a result, Canadian women caught up to their American counterparts by the late 1980s, and, in 1989, the labour force participation rate of women aged 25 to 54 in both countries was 74%.

An equally salient development was the stagnation in the women’s labour force participation rate in both Canada and the U.S. throughout the early to mid-1990s—when it hovered around 75%.

The slow growth during the 1990s led observers in both countries to consider whether the rising trend of women participating in the workforce was almost over. In a study from the late 1990s, it was predicted, at least in relation to Canada circa 1994, that “large increases in the participation and employment rates are clearly a thing of the past” and that “there is still room for a 2-3 percentage point increase in the rates if the macroeconomic situation continues to improve.”Note 4 The plateau reached in the female LFPR also led some pundits to believe that a “natural rate” of participation had been reached in the United States, although the rising participation of working mothers led others to question whether the data supported the evidence of such a natural rate.Note 5

In the late 1990s, however, the data started contrasting with previous trends. The labour force participation of Canadian women continued its upward trend while the rate for American women began to decline.Note 6 After 1997, the LFPR of women in Canada always remained higher than that of their counterparts in the United States. Some observers in the U.S. concluded that the dip in the participation rate in the early 2000s was due to a sluggish labour market characterized by low employment growth.Note 7

The divergence in the participation rates between Canada and the United States might partly reflect the relative strength of the Canadian labour market. While the recession of the late 2000s resulted in significant job losses in both countries, it has been described as the most severe recession of the post-war period in the United StatesNote 8 while, in Canada, it was considered less severe than recessions that began in 1981 and 1990.Note 9 Canada lost fewer jobs during the recession of the late 2000s and employment has grown at a faster rate since the recession ended.Note 10 By 2015, the labour force participation rate of Canadian women was 81% compared with 74% for American women.Note 11

Canadian women have higher employment rates than their U.S. counterparts

The labour force consists of persons in the eligible population who participate in the labour market as either employed or unemployed. The employment rate—the proportion of the labour force that is employed during the reference week divided by the total working-age population—captures another perspective. Similar to the LFPR, the employment rate in the United States trended downwards after 2000 and through the last recession while, in Canada, it continued its upward trend. By 2015, the employment rate in Canada was 7 percentage points higher than in the U.S. (Chart 2).

Chart 2 Employment rates in Canada and the United States, women aged 25 to 54, 1980 to 2015

Data table for Chart 2
Chart 2
Employment rates in Canada and the United States, women aged 25 to 54, 1980 to 2015
Table summary
This table displays the results of Employment rates in Canada and the United States. The information is grouped by Year (appearing as row headers), Employment rate, Canada, Employment rate, United States, Full-time employment rate, Canada and Full-time employment rate, United States, calculated using percentage of population units of measure (appearing as column headers).
Year Employment rate, Canada Employment rate, United States Full-time employment rate, Canada Full-time employment rate, United States
percentage of population
1980 55.9 60.1 38.6 Note ...: not applicable
1989 68.9 70.3 48.6 Note ...: not applicable
1997 71.0 73.6 47.8 57.6
2000 74.0 74.3 51.2 59.5
2007 78.2 72.6 55.8 58.2
2015 77.5 70.5 55.0 56.3

Hours worked by those employed in the labour force is another key dimension that differs between Canada and the United States. Historically, the proportion of women aged 25 to 54 working full time (35 hours or more per week, in the main or only job)Note 12 has been higher in the United States than in Canada. In 1997, 58% of American women had a full-time job, compared with 48% of Canadian women.Note 13 In 2015, the gap was much smaller (55% in Canada versus 56% in the United States), largely because of an increase in the full-time employment rate of Canadian women.

The unemployment rate—the proportion of the labour force that is unemployed during the reference week—provides useful additional information. Labour force participation can be responsive to changes in overall unemployment, and, in some instances, when the unemployment rate is high, some of the unemployed might stop looking for work and drop out of the labour force.

Between 1977 and 2007, the unemployment rate among prime-aged women in Canada was consistently higher than the rate in the U.S. (Chart 3). However, the gap started closing in the mid-1990s and, following the recession of the late 2000s—from 2008 to 2014—the unemployment rate in the U.S. exceeded that in Canada. Recently, however, the U.S. rate declined while the Canadian rate remained relatively stable. In 2015, the two countries had a similar unemployment rate.Note 14

Chart 3 Unemployment rates in Canada and the United States, women aged 25 to 54, 1976 to 2015

Data table for Chart 3
Chart 3
Unemployment rates in Canada and the United States, women aged 25 to 54, 1976 to 2015
Table summary
This table displays the results of Unemployment rates in Canada and the United States. The information is grouped by Year (appearing as row headers), Canada and United States, calculated using percent units of measure (appearing as column headers).
Year Canada United States
percent
1976 6.5 6.8
1977 7.2 6.4
1978 7.7 5.5
1979 6.9 5.2
1980 6.4 6.0
1981 6.6 6.3
1982 8.5 7.7
1983 9.3 7.7
1984 9.4 6.3
1985 8.9 6.2
1986 8.1 5.9
1987 7.8 5.1
1988 7.1 4.6
1989 6.8 4.4
1990 6.9 4.6
1991 8.3 5.4
1992 8.5 6.0
1993 9.2 5.7
1994 8.1 5.0
1995 7.3 4.5
1996 7.4 4.4
1997 6.8 4.1
1998 6.2 3.8
1999 5.6 3.4
2000 5.0 3.3
2001 5.3 3.9
2002 5.6 4.8
2003 5.6 4.8
2004 5.1 4.6
2005 5.0 4.4
2006 4.4 3.9
2007 4.0 3.8
2008 4.0 4.6
2009 5.3 7.2
2010 5.5 7.8
2011 5.1 7.6
2012 4.9 7.1
2013 4.7 6.3
2014 4.5 5.3
2015 4.6 4.6

The next section investigates the recent divergence in the labour force participation rates in both countries, using 1997 as a starting point. The age groups that contributed the most to the difference are examined first, followed by the potential role played by rising levels of women’s educational attainment in both countries.

Labour force participation on the rise among older Canadian women

In 1997, the female labour market participation rates in Canada and the United States were half a percentage point apart. Over the next 18 years, the LFPR rose by 5 percentage points in Canada and declined by 3 percentage points in the United States. The decline in the U.S. took place mostly after 2007—in the aftermath of the 2008-09 recession. In Canada, most of the increase took place from 1997 to 2007.

To gain a better understanding of the source of the Canada–U.S. LFPR divergence that occurred after 1997, it is important to identify the age groups that have contributed the most to changes in both countries.

In Canada, the overall participation rate increased largely because of women aged 45 to 54, for whom the participation rate increased from 72% to 82% over the period. In fact, more than one-half of the overall increase was due to an increase in the LFPR of women aged 45 to 54 in Canada (Table 1).Note 15

Table 1
Decomposition of percentage change in labour force participation rates of women aged 25 to 54 across age groups, Canada and United States, 1997 to 2015
Table summary
This table displays the results of Decomposition of percentage change in labour force participation rates of women aged 25 to 54 across age groups Changes among those aged 25 to 44, Changes among those aged 45 to 54, Changes in group shares and Total, calculated using percentage point units of measure (appearing as column headers).
  Changes among those aged 25 to 44 Changes among those aged 45 to 54 Changes in group shares Total
percentage point
Canada 2.0 2.8 0.2 5.0
United States -2.0 -0.7 -0.2 -2.8
Difference 4.0 3.5 0.4 7.8

In the United States, most of the decline was due to a decrease in the LFPR of women aged 25 to 44.Note 16 Between 1997 and 2015, the participation of U.S. women in this age group fell by three percentage points, from 77% to 74%. This compared with a Canadian increase of three percentage points among women in the same age group (from 78% to 81%).

The changes in labour force participation varied by level of education

Within age groups, there were differences across education levels. In general, differences were more pronounced among less-educated women.

Among Canadian women aged 45 to 54, the largest increase took place in the two lowest educational attainment categories (Table 2). Among women with a high school diploma or less, the rate increased by 8 percentage points (from 64% to 72%), and among those with a college-level education, the rate increased by 7 percentage points (from 78% to 85%). University graduates also recorded a gain, but of a smaller magnitude.

Table 2
Labour force participation rates of women aged 25 to 54 by age group and education, Canada and the United States, 1997 to 2015
Table summary
This table displays the results of Labour force participation rates of women aged 25 to 54 by age group and education All, High school or less, College, trade or other postsecondary and University degree, calculated using percent units of measure (appearing as column headers).
  All High school or less College, trade or other postsecondary University degree
percent
Canada  
Aged 25 to 54  
1997 76.2 66.6 81.0 86.3
2000 77.9 68.9 81.9 86.2
2007 81.5 72.3 84.9 86.3
2015 81.3 68.0 84.4 86.6
Aged 25 to 44  
1997 77.8 68.2 82.0 86.6
2000 79.4 70.8 82.5 86.0
2007 82.0 72.3 85.1 85.4
2015 80.9 65.2 84.0 86.0
Aged 45 to 54  
1997 72.3 63.5 78.0 85.3
2000 74.8 65.6 80.1 86.5
2007 80.8 72.3 84.7 88.5
2015 82.0 71.8 85.0 88.3
United States  
Aged 25 to 54  
1997 76.7 69.7 80.6 84.6
2000 76.8 70.1 80.4 83.0
2007 75.5 67.0 79.2 82.3
2015 73.9 62.3 76.1 82.4
Aged 25 to 44  
1997 77.0 70.3 80.5 84.1
2000 76.9 70.7 80.3 82.3
2007 75.1 66.4 78.9 81.3
2015 74.0 61.5 76.4 82.2
Aged 45 to 54  
1997 76.1 68.2 81.0 85.9
2000 76.6 68.9 80.6 84.6
2007 76.2 68.0 79.8 84.2
2015 73.7 63.6 75.6 83.0

In contrast, the participation rate of U.S. women aged 45 to 54 declined most among those who were in the two lowest categories of educational attainment. For those with at most a high school diploma, the LFPR declined from 68% to 64%; similarly, the LFPR declined from 81% to 76% for those with a college-level education.

Similar trends were found in the case of younger women. In the United States, the decline in the LFPR of younger women (aged 25 to 44) was especially more pronounced among those in the two lowest categories of educational attainment—by a margin of 9 percentage points for those with a high school diploma or less and 4 percentage points for those with a college-level education.Note 17 The participation rates of those with a university degree also declined, but by a smaller margin (2 percentage points).

In comparison, the LFPR of Canadian women aged 25 to 44 who had at most a high school diploma also declined, but by a smaller margin than their U.S. counterparts (3 percentage points). Canadian women in this age group who had a college-level education recorded a small increase, while the LFPR of those who had a university degree changed little.

By 2015, Canadian women in all age and education categories were thus more likely to participate in the labour market than their U.S. counterparts (Chart 4). This represents a change from 1997, when only Canadian women aged 25 to 44 with a university degree or college education were more likely to participate in the labour market than their American counterparts.

Chart 4 Percentage difference between Canada and the United States in labour force participation rates of women aged 25 to 54, 1997 to 2015

Data table for Chart 4
Chart 4
Percentage difference between Canada and the United States in labour force participation rates of women aged 25 to 54, 1997 to 2015
Table summary
This table displays the results of Percentage difference between Canada and the United States in labour force participation rates of women aged 25 to 54. The information is grouped by Age group (appearing as row headers), Level of education, 1997, 2000, 2007 and 2015, calculated using percentage difference units of measure (appearing as column headers).
Age group Level of education 1997 2000 2007 2015
percentage difference
Aged 25 to 44 High school or less -2.1 0.1 5.9 3.7
College, trade or other postsecondary 1.5 2.2 6.2 7.6
University degree 2.5 3.7 4.1 3.8
Aged 45 to 54 High school or less -4.7 -3.3 4.3 8.2
College, trade or other postsecondary -3.0 -0.5 4.9 9.4
University degree -0.6 1.9 4.3 5.3

The magnitude of the change was especially large in the case of women aged 45 to 54 with a high school diploma or a college education. In 1997, for example, U.S. women in this age group who had a high school education were 5 percentage points more likely than their counterparts in Canada to participate in the labour market. In 2015, Canadian women were more likely to participate—by a margin of 8 percentage points.

Rising levels of educational attainment contributed positively to the LFPR of women in both countries

Between 1997 and 2015, the level of educational attainment of women rose in Canada and in the United States. The proportion of women with a university degree nearly doubled in Canada, as it increased from 18% to 35%. In the United States, the proportion also rose—albeit less rapidly—from 26% to 38% (Table 3).

Table 3
Highest level of educational attainment of women aged 25 to 54, Canada and United States, 1997 and 2015
Table summary
This table displays the results of Highest level of educational attainment of women aged 25 to 54 Canada, United States, 1997 and 2015, calculated using percent units of measure (appearing as column headers).
  Canada United States
1997 2015 1997 2015
percent
Aged 25 to 54  
High school or less 39.7 23.5 45.1 33.4
College, trade or other postsecondary 42.0 41.4 28.5 28.8
University degree 18.3 35.1 26.4 37.8
Aged 25 to 44  
High school or less 36.7 20.5 43.8 31.5
College, trade or other postsecondary 43.8 40.5 29.3 28.9
University degree 19.5 39.0 26.9 39.7
Aged 45 to 54  
High school or less 47.0 29.2 48.0 37.2
College, trade or other postsecondary 37.6 43.0 26.7 28.6
University degree 15.5 27.8 25.3 34.2

The increase was larger in the case of women aged 25 to 44, especially in Canada. The proportion of Canadian women aged 25 to 44 with a university degree increased nearly twofold over the period, from 20% to 39%. In the United States, women in this age group were more likely than Canadian women to have a university degree in 1997 (27%), but were about as likely as their Canadian counterparts to have a degree in 2015 (40%).

To what extent have changes in the LFPR of both countries been impacted by the rising educational attainment of women in both countries? This question can be answered by isolating the changes related to education from those related to other factors by estimating a series of regression models.Note 18 Because the highly educated are more likely to be employed than those with lower levels of education, it is likely that rising levels of education played a positive role in increasing the LFPR in both countries between 1997 and 2015.

While the increase in educational attainment contributed to the increase in the LFPR of Canadian women over the period, its role varied across age groups. Among those aged 25 to 44, the entire increase of 3 percentage points in the LFPR of Canadian women between 1997 and 2015 was due to their rising level of educational attainment (Chart 5). Changes in educational attainment explained one-third of the 10 percentage point increase in the LFPR for those aged 45 to 54, indicating that two-thirds of the increase was due to other factors.

Chart 5 Impact of variations in educational attainment on changes in labour force participation rates of women aged 25 to 54, Canada and United States, 1997 to 2015

Data table for Chart 5
Chart 5
Impact of variations in educational attainment on changes in labour force participation rates of women aged 25 to 54, Canada and United States, 1997 to 2015
Table summary
This table displays the results of Impact of variations in educational attainment on changes in labour force participation rates of women aged 25 to 54 Age group, Due to changes in level of education and Due to other factors, calculated using percent units of measure (appearing as column headers).
  Age group Due to changes in level of education Due to other factors
percent
Canada 25 to 44 3.1 0.0
45 to 54 3.0 6.7
United States 25 to 44 2.2 -5.1
45 to 54 1.9 -4.3

In addition, even though the rising educational attainment of women in the United States had a positive effect on the LFPR, that effect was more than offset by declines in the LFPR within educational categories. In fact, without the positive contribution of rising educational attainment, the LFPR would have declined by 5 percentage points among women aged 25 to 44, and by 4 percentage points among those aged 45 to 54.

If educational differences do not fully explain the rising divergence of the LFPR in both countries—particularly among those aged 45 to 54—then there might be other factors driving the increase in the LFPR of Canadian women, such as increased demand for labour in female-dominated occupations or differences in earnings growth.

More full-time and private sector jobs among Canadian women aged 45 to 54

Additional insight can be gained by examining the characteristics of jobs held by Canadian women aged 45 to 54—particularly among those with a high school education or less and those with a college-level education.

From 1997 to 2007, for instance, the number of employed women aged 45 to 54 with at most a high school diploma rose by more than 120,000 in Canada. More than one-half of these additional jobs were sales and service occupations (such as customer and sales representatives, light duty cleaners and cashiers), the vast majority of which were full-time jobs in the private sector.

Over the same period, the number of employed college-educated women in this age group increased by approximately 333,000. Again, the vast majority of these jobs were private sector and full-time jobs. More than one-third of these additional jobs were business, finance and administration occupations, and another quarter were sales and service occupations.

The labour force participation of Canadian women might also have been stimulated by a faster growth in real earnings (expressed in 2014 constant dollars).Note 19 From 1997 to 2014, the median weekly earnings of women aged 25 and over who were working full time increased by 14% in Canada compared with 11% in the United States.Note 20 In the U.S., however, one-third of the increase took place between 1997 and 1998. From 1998 to 2014, weekly earnings grew by 14% in Canada, compared with 7% in the United States.

There was also a difference in the growth rate of earnings among those who had lower levels of education, which might have contributed to the increase in the labour supply of Canadian women. For instance, among women who did not complete high school, the real weekly earnings of women grew by 8% in Canada but by 1% in the U.S. between 1997 and 2014.Note 21

The gender gap in participation rates declined faster in Canada

A comparison with the relative status of men provides a clearer picture of the trends in women’s labour force participation in Canada and the United States—rising women’s labour force participation rates, coupled with a slow but steady decline in men’s participation, has caused the gap in the LFPRs of men and women to narrow.

From 1990 to 2015, the LFPR of men aged 25 to 54 dropped 2 percentage points in Canada and 5 percentage points in the United States. In Canada, the LFPR gender gap narrowed from 18 percentage points in 1990 to 9 percentage points by 2015. In the U.S., it decreased from 19 to 14 percentage points during the same period (Chart 6).

Chart 6 Gender gap in labour force participation rates among workers aged 25 to 54, Canada and the United States, 1976 to 2015

Data table for Chart 6
Chart 6
Gender gap in labour force participation rates among workers aged 25 to 54, Canada and the United States, 1976 to 2015
Table summary
This table displays the results of Gender gap in labour force participation rates among workers aged 25 to 54. The information is grouped by Year (appearing as row headers), Canada and United States, calculated using percentage point units of measure (appearing as column headers).
Year Canada United States
percentage point
1976 42.5 37.4
1977 40.7 35.7
1978 38.6 33.7
1979 36.9 32.1
1980 34.7 30.3
1981 32.3 28.8
1982 30.4 27.7
1983 28.6 26.7
1984 26.8 25.7
1985 25.2 24.3
1986 23.8 23.0
1987 22.6 21.8
1988 20.7 20.9
1989 19.4 20.0
1990 18.0 19.4
1991 16.9 19.0
1992 16.4 18.4
1993 16.0 18.0
1994 16.1 16.5
1995 15.4 16.0
1996 15.1 15.6
1997 14.3 15.2
1998 13.7 15.3
1999 13.0 15.0
2000 12.7 14.9
2001 12.1 14.9
2002 11.1 15.2
2003 10.6 14.9
2004 10.1 15.2
2005 10.4 15.2
2006 9.9 15.1
2007 9.0 15.5
2008 9.6 14.7
2009 8.6 14.1
2010 8.2 14.0
2011 8.6 14.0
2012 8.4 14.2
2013 8.0 14.5
2014 8.6 14.3
2015 8.9 14.4

Taken together, the overall decline in the Canadian LFPR gender gap resulted more from women’s increasing LFPR than the drop in men’s participation rate. The opposite holds true for the United States—the decline in the gender gap since 1990 resulted more from the decline in men’s LFPR than changes in women’s LFPR.

Conclusion

This article presents a set of indicators on the state of the labour market participation of women in Canada and the United States. Through comparative analysis, the recent trends in the LFPR show that Canadian women aged 25 to 54 are more likely to participate in the labour market than their American counterparts. In the past two decades, the LFPR of Canadian women increased slightly, while the LFPR of American women declined.

In Canada, most of the increase in the LFPR of women could be attributed to a significant increase in the labour market participation of women aged 45 to 54, especially for those with lower levels of education. In the United States, despite the positive impact of increasing education, labour market participation decreased for women in both age groups (25 to 44 and 45 to 54), especially for younger women with lower levels of education. However, women in the U.S. were slightly more likely to work full time than their Canadian counterparts.

The increase in the labour market participation of women aged 45 to 54 in Canada remains a topic for further research. However, the fact that the increase mainly took place during a period of sustained economic growth prior to the downturn of the late 2000s—and that women with lower levels of education were behind the push in Canadian LFPRs—suggests that labour market conditions might have played a role.

In contrast, the United States was hit by the worst recession in decades in the late 2000s, which likely stymied employment opportunities for women—especially those with lower levels of education. Canada was also hit by a recession but did not experience the same drop in the LFPR of women during those years.

Marie Drolet is a senior researcher with the Labour Statistics Division at Statistics Canada, Sharanjit Uppal is senior researcher with Insights on Canadian Society and Sébastien LaRochelle-Côté is Editor-in-Chief of Insights on Canadian Society.

Start of text box

Data sources, methods and definitions

Data sources

Data for Canada are drawn from Statistics Canada’s Labour Force Survey (LFS) and labour market information for the United States is derived from the Current Population Survey (CPS). While the LFS and the CPS are both monthly household surveys that use similar methodologies, adjustments had to be made to the Canadian data to make it comparable with the U.S. concepts.Note 22 The adjustments are explained below.

Adjustments to Canadian data

The following adjustments were made to the Canadian Labour Force Survey (LFS) data to make it directly comparable with the U.S. Current Population Survey (CPS) data.

  1. Three groups of people, considered unemployed in Canada, are deemed not to be participating in the labour force in the United States:
    1. people who were looking for work but who only looked at job ads;
    2. people who had not looked for work but who reported that they had a job that would start in the next four weeks; and
    3. people who had reported that they were not available to work because of personal or family responsibilities.
      These three groups of people were removed from the unemployed population in the LFS and were added to the population of people not participating in the labour force.
  2. Full-time students who report that they are looking for full-time work are not considered participants in the labour force in Canada but are considered to be part of the unemployed population in the United States. These people were removed from the population that was not participating in the labour force in the LFS and were added to the unemployed population.

On average, the Canadian labour market participation rates (LFPRs) reported in this article were adjusted downwards by about 0.6 percentage points throughout the period from 1976 to 2013. In addition—even though this does not have an impact on this particular study—readers should note that the CPS target population includes individuals aged 16 and over, while the LFS includes individuals aged 15 and over.

Method for decomposition of percentage point change in labour force participation rate across age groups

Β y2 Β y1 = ( Β g1,y2 X g1,y2 + Β g2,y2 X g2,y2 )  ( Β g1,y1 X g1,y1 + Β g2,y1 X g2,y1 ) = Β g1,y2 X g1,y2 + Β g2,y2 X g2,y2 + Β g1,y1 X g1,y2 Β g1,y1 X g1,y2 + Β g2,y2 X g2,y1 Β g2,y2 X g2,y1 Β g1,y1 X g1,y1 Β g2,y1 X g2,y1 MathType@MTEF@5@5@+= feaagKart1ev2aaatCvAUfeBSjuyZL2yd9gzLbvyNv2CaerbuLwBLn hiov2DGi1BTfMBaeXatLxBI9gBaerbd9wDYLwzYbItLDharqqtubsr 4rNCHbGeaGqiVu0Je9sqqrpepC0xbbL8F4rqqrFfpeea0xe9Lq=Jc9 vqaqpepm0xbba9pwe9Q8fs0=yqaqpepae9pg0FirpepeKkFr0xfr=x fr=xb9adbaqaaeGaciGaaiaabeqaamaabaabaaGcbaqbaeaabiqaaa qaaabaaaaaaaaapeGaeuOKdi0damaaBaaaleaapeGaamyEaiaaikda a8aabeaak8qacaGGtaIaeuOKdi0damaaBaaaleaapeGaamyEaiaaig daa8aabeaak8qacqGH9aqpcaqGGaWdaiaacIcapeGaeuOKdi0damaa BaaaleaapeGaam4zaiaaigdacaGGSaGaamyEaiaaikdaa8aabeaak8 qacaWGybWdamaaBaaaleaapeGaam4zaiaaigdacaGGSaGaamyEaiaa ikdaa8aabeaak8qacqGHRaWkcqqHsoGqpaWaaSbaaSqaa8qacaWGNb GaaGOmaiaacYcacaWG5bGaaGOmaaWdaeqaaOWdbiaadIfapaWaaSba aSqaa8qacaWGNbGaaGOmaiaacYcacaWG5bGaaGOmaaWdaeqaaOGaai yka8qacaqGGaGaeyOeI0Iaaeiia8aacaGGOaWdbiabfk5ac9aadaWg aaWcbaWdbiaadEgacaaIXaGaaiilaiaadMhacaaIXaaapaqabaGcpe Gaamiwa8aadaWgaaWcbaWdbiaadEgacaaIXaGaaiilaiaadMhacaaI XaaapaqabaGcpeGaey4kaSIaeuOKdi0damaaBaaaleaapeGaam4zai aaikdacaGGSaGaamyEaiaaigdaa8aabeaak8qacaWGybWdamaaBaaa leaapeGaam4zaiaaikdacaGGSaGaamyEaiaaigdaa8aabeaakiaacM caaeaapeGaeyypa0JaeuOKdi0damaaBaaaleaapeGaam4zaiaaigda caGGSaGaamyEaiaaikdaa8aabeaak8qacaWGybWdamaaBaaaleaape Gaam4zaiaaigdacaGGSaGaamyEaiaaikdaa8aabeaak8qacqGHRaWk cqqHsoGqpaWaaSbaaSqaa8qacaWGNbGaaGOmaiaacYcacaWG5bGaaG OmaaWdaeqaaOWdbiaadIfapaWaaSbaaSqaa8qacaWGNbGaaGOmaiaa cYcacaWG5bGaaGOmaaWdaeqaaOWdbiabgUcaRiabfk5ac9aadaWgaa WcbaWdbiaadEgacaaIXaGaaiilaiaadMhacaaIXaaapaqabaGcpeGa amiwa8aadaWgaaWcbaWdbiaadEgacaaIXaGaaiilaiaadMhacaaIYa aapaqabaGcpeGaeyOeI0IaeuOKdi0damaaBaaaleaapeGaam4zaiaa igdacaGGSaGaamyEaiaaigdaa8aabeaak8qacaWGybWdamaaBaaale aapeGaam4zaiaaigdacaGGSaGaamyEaiaaikdaa8aabeaak8qacqGH RaWkcqqHsoGqpaWaaSbaaSqaa8qacaWGNbGaaGOmaiaacYcacaWG5b GaaGOmaaWdaeqaaOWdbiaadIfapaWaaSbaaSqaa8qacaWGNbGaaGOm aiaacYcacaWG5bGaaGymaaWdaeqaaOWdbiabgkHiTiabfk5ac9aada WgaaWcbaWdbiaadEgacaaIYaGaaiilaiaadMhacaaIYaaapaqabaGc peGaamiwa8aadaWgaaWcbaWdbiaadEgacaaIYaGaaiilaiaadMhaca aIXaaapaqabaGcpeGaeyOeI0IaeuOKdi0damaaBaaaleaapeGaam4z aiaaigdacaGGSaGaamyEaiaaigdaa8aabeaak8qacaWGybWdamaaBa aaleaapeGaam4zaiaaigdacaGGSaGaamyEaiaaigdaa8aabeaak8qa cqGHsislcqqHsoGqpaWaaSbaaSqaa8qacaWGNbGaaGOmaiaacYcaca WG5bGaaGymaaWdaeqaaOWdbiaadIfapaWaaSbaaSqaa8qacaWGNbGa aGOmaiaacYcacaWG5bGaaGymaaWdaeqaaaaaaaa@D53A@

= changes in rates : { X g1,y2 ( Β g1,y2 Β g1,y1 ) +  X g2,y1 ( Β g2,y2 Β g2,y1 )} MathType@MTEF@5@5@+= feaagKart1ev2aaatCvAUfeBSjuyZL2yd9gzLbvyNv2CaerbuLwBLn hiov2DGi1BTfMBaeXatLxBI9gBaerbd9wDYLwzYbItLDharqqtubsr 4rNCHbGeaGqiVu0Je9sqqrpepC0xbbL8F4rqqrFfpeea0xe9Lq=Jc9 vqaqpepm0xbba9pwe9Q8fs0=yqaqpepae9pg0FirpepeKkFr0xfr=x fr=xb9adbaqaaeGaciGaaiaabeqaamaabaabaaGcbaGaai4Eaabaaa aaaaaapeGaamiwa8aadaWgaaWcbaWdbiaadEgacaaIXaGaaiilaiaa dMhacaaIYaaapaqabaGccaGGOaWdbiabfk5ac9aadaWgaaWcbaWdbi aadEgacaaIXaGaaiilaiaadMhacaaIYaaapaqabaGcpeGaeyOeI0Ia euOKdi0damaaBaaaleaapeGaam4zaiaaigdacaGGSaGaamyEaiaaig daa8aabeaakiaacMcapeGaaeiiaiabgUcaRiaabccacaWGybWdamaa BaaaleaapeGaam4zaiaaikdacaGGSaGaamyEaiaaigdaa8aabeaaki aacIcapeGaeuOKdi0damaaBaaaleaapeGaam4zaiaaikdacaGGSaGa amyEaiaaikdaa8aabeaak8qacqGHsislcqqHsoGqpaWaaSbaaSqaa8 qacaWGNbGaaGOmaiaacYcacaWG5bGaaGymaaWdaeqaaOGaaiykaiaa c2haaaa@611A@

+ changes in group shares : { Β g1,y1 ( X g1,y2   X g1,y1 ) + Β g2,y2 ( X g2,y2   X g2,y1 )} MathType@MTEF@5@5@+= feaagKart1ev2aaatCvAUfeBSjuyZL2yd9gzLbvyNv2CaerbuLwBLn hiov2DGi1BTfMBaeXatLxBI9gBaerbd9wDYLwzYbItLDharqqtubsr 4rNCHbGeaGqiVu0Je9sqqrpepC0xbbL8F4rqqrFfpeea0xe9Lq=Jc9 vqaqpepm0xbba9pwe9Q8fs0=yqaqpepae9pg0FirpepeKkFr0xfr=x fr=xb9adbaqaaeGaciGaaiaabeqaamaabaabaaGcbaGaai4Eaabaaa aaaaaapeGaeuOKdi0damaaBaaaleaapeGaam4zaiaaigdacaGGSaGa amyEaiaaigdaa8aabeaakmaabmaabaWdbiaadIfapaWaaSbaaSqaa8 qacaWGNbGaaGymaiaacYcacaWG5bGaaGOmaaWdaeqaaOWdbiabgkHi TiaabccacaWGybWdamaaBaaaleaapeGaam4zaiaaigdacaGGSaGaam yEaiaaigdaa8aabeaaaOGaayjkaiaawMcaa8qacaqGGaGaey4kaSIa euOKdi0damaaBaaaleaapeGaam4zaiaaikdacaGGSaGaamyEaiaaik daa8aabeaakmaabmaabaWdbiaadIfapaWaaSbaaSqaa8qacaWGNbGa aGOmaiaacYcacaWG5bGaaGOmaaWdaeqaaOWdbiabgkHiTiaabccaca WGybWdamaaBaaaleaapeGaam4zaiaaikdacaGGSaGaamyEaiaaigda a8aabeaaaOGaayjkaiaawMcaaiaac2haaaa@6113@

where

g1: age group 25 to 44

g2: age group 45 to 54

y1: year 1997

y2: year 2015

Β: average labour force participation rate of a given age group

X: share of the age group in the population aged 25 to 54

End of text box

Start of text box

Differences in labour market participation of mothers

Researchers in the United States have pointed to a number of policy initiatives designed to facilitate women’s participation in the labour market (for example, entitlement to job-protected parental leave and the right to part-time work) as possible explanations for the decline in American women’s position in their labour force participation rates relative to other OECD countries.Note 23 Women—in both Canada and the United States—are having fewer children and are having them at more advanced ages. In Canada, the average age of first-time mothers increased by 5.3 years, from 23.7 years of age in 1970 to 29.0 years of age in 2012. While the average age of first-time mothers increased by 4.2 years in the United States in the same period, first-time mothers were younger in the United States (25.6 years) than in Canada (29.0 years) in 2012.Note 24 Among the reasons cited for delaying motherhood are the pursuit of higher levels of education and young women’s commitment to their career.

The labour force participation of women with children has generally been increasing over the past three decades in both countries (Chart 7).Note 25 By 2014, 70% of Canadian women with children under the age of 3 participated in the labour force, more than double the figure in 1976, when 31% of those women participated. The numbers for the United States were 34% in 1976 and 62% in 2014.Note 26 Note that both Canadian and U.S. LFPRs were relatively close in the late 1990s, but they continued to increase in Canada (albeit slightly) over the 2000s, while remaining stable in the United States. As a result, the labour force participation in 2014 of Canadian mothers with young children was about 8 percentage points higher than the rate for mothers with young children in the United States.

Chart 7 Labour force participation rates of mothers with children under the age of 3, Canada and United States, 1976 to 2014

Data table for Chart 7
Chart 7
Labour force participation rates of mothers with children under the age of 3, Canada and United States, 1976 to 2014
Table summary
This table displays the results of Labour force participation rates of mothers with children under the age of 3. The information is grouped by Year (appearing as row headers), Canada and United States, calculated using percent units of measure (appearing as column headers).
Year Canada United States
percent
1976 31.3 34.1
1977 33.6 35.4
1978 36.7 39.4
1979 38.8 41.1
1980 41.1 41.9
1981 43.8 44.3
1982 44.9 45.6
1983 48.4 46.0
1984 50.9 47.6
1985 53.3 49.5
1986 55.5 50.8
1987 56.1 52.9
1988 57.1 52.4
1989 58.7 52.4
1990 58.8 53.6
1991 60.4 54.5
1992 59.8 54.5
1993 60.1 53.9
1994 60.7 57.1
1995 61.0 58.7
1996 62.4 59.0
1997 63.6 61.8
1998 63.9 62.2
1999 64.0 60.7
2000 63.8 61.0
2001 64.7 60.7
2002 65.9 60.5
2003 67.0 58.7
2004 68.1 57.3
2005 68.2 58.9
2006 67.9 59.9
2007 67.9 60.1
2008 67.4 59.6
2009 68.0 61.1
2010 69.4 61.1
2011 68.3 60.9
2012 69.1 60.7
2013 70.7 62.1
2014 69.5 61.8

There are differences in the entitlement to parental leave between the two countries, which could account for differences in labour market participation. In Canada, mothers with 20 or more insurable weeks of earnings could claim up to 15 weeks of maternity benefits starting in 1971. In 1990, 10 weeks of parental leave were added, which the parents could share based on their needs. Starting in December 2000, parental leave benefits increased from 10 weeks to 35 weeks—raising the total paid leave parents could take from 6 months to 1 year. Employers are required to accept the employees back into their job, or an equivalent job, at the end of the mandated leave and at the same rate of pay with the same employment benefits.Note 27 The early 2000s also coincided with the introduction of a program of universal subsidized daycare in Quebec, which led to a significant increase in the labour market participation of working mothers.Note 28 In the United States, the 1993 federal Family and Medical Leave Act (FMLA) requires employers to provide up to 12 weeks of unpaid leave for the birth of a baby. Before the law was enacted, the U.S. had no laws requiring that employers provide any leave.Note 29

Research has shown that most women take the full amount of leave to which they are entitled and then return to their pre-birth job. According to a study based on Canadian data from 1993 to 1996, 16% of female employees in Canada went back to work by the end of the first month after the birth of their child and about 90% returned to work after one year.Note 30 In comparison, according to a U.S. study based on 2001 data,Note 31 about 11% of mothers employed at the time of the birth of their child were back at work within one month and nearly 90% were back at work 9 months after giving birth. Over 80% of mothers who returned to work returned to the same employer.Note 32

End of text box


Date modified: